Consol Energy Inc. will become the Port of Pittsburgh's dominant river-based coal carrier by acquiring Mon River Towing and J.A.R. Barge Lines LP from the Guttman Group in a deal announced Thursday.
The deal boosts the Upper St. Clair-based company's river and docking operations -- more than tripling its towboat fleet, doubling the size of its barge fleet and its coal transport capacity.
The latest statistics from the U.S. Army Corps of Engineers show that the Port of Pittsburgh in 2003 handled 30.2 million tons of coal, meaning Consol has the capacity to haul 79 percent of the port's coal.
The area's largest towboat operator in terms of towboats remains Campbell Transportation Co. Inc. in Dunlevy, Washington County.
Terms of the deal were not disclosed. Mon River Towing also transports petroleum products, limestone and other commodities along Pennsylvania, Ohio, West Virginia and Kentucky rivers. J.A.R. Barge Line charters vessels and barges to other river transportation firms.
At a time when towboats and barges are in short supply, when most barge fleets are under contract and the cost of new equipment can soar, experts said the deal makes economic sense.
"It's a smart move for Consol. It extends their reach right to the power plants, allows them to quote prices," said Jamie Heller, principal with the consulting firm Hellerworx Inc., Chevy Chase, Md. "It's actually a back-to-the-future move as a number of coal companies at one time owned barge companies."
"There is an avalanche of (power) plant operators installing (pollution control) scrubbers that will allow power companies to look at the higher-sulphur coal we produce," said Consol spokesman Tom Hoffman. "Expanding our barge operations enhances our ability to serve existing customers, but gives our sales staff a great tool when calling on new customers."
"They approached us last August," said Gary Smelko, spokesman for the Guttman Group, Mon River's parent. "Mon River has been very successful, very profitable."
Consol will lease space at Guttman headquarters in Speers, Washington County, along with docking facilities at Belle Vernon indefinitely, Smelko said.
Additional Information:
Comparing fleets
By acquiring Mon River Towing, Consol Energy solidifies its position as the Port of Pittsburgh's largest locally owned coal carrier. Campbell Transportation Co. Inc. is the only other sizable locally owned towing company.
